Modernising Russia's cattle and dairy sectors under WTO conditions: Insights from East Germany

How to revitalise the cattle and dairy sectors under the WTO commitments has emerged as a major policy challenge for the Russian government. This article raises the question whether livestock recovery in East Germany does provide any insights that could be of value to current policy makers in Russia. Similar to Russia, livestock numbers plummeted in the first years after the end of central planning. Unlike in Russia, milk output per cow increased spectacularly and almost doubled in a period of 20 years. It is argued that reforms of the institutional environment of agriculture were at least as important for this outcome as the generous availability of funding. Incentives set by financial aid were sometimes unintended, inconsistent, and led to misallocations that were costly to correct later on. More recent capital subsidies were inefficient in reaching any of the manifold goals they were hoped to achieve. While the Russian government may face little difficulty in dressing up its investment subsidies to make them look like green box compatible, the structural elements of the EU's Common Agricultural Policy are regarded as a poor guide for policy reform.


Variant title:
Die Modernisierung der russischen Rinder- und Milchproduktion unter WTO-Bedingungen: Erfahrungen aus Ostdeutschland
Issue Date:
2014
Publication Type:
Working or Discussion Paper
DOI and Other Identifiers:
ISSN 1438-2172 (Other)
Record Identifier:
http://ageconsearch.umn.edu/record/184335
PURL Identifier:
http://purl.umn.edu/184335
Total Pages:
21
JEL Codes:
P52; Q14; Q17
Series Statement:
IAMO Discussion Paper
150




 Record created 2017-04-01, last modified 2018-01-22

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